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01.11.2021 Market Report


EUR/USD remains sidelined around 1.1550, following the heaviest daily fall since mid-June, heading into Monday’s European session. Having witnessed the European Central Bank’s (ECB) failed attempt to hide hawkish intentions, the market turns towards the US Federal Reserve (Fed) with high hopes of tapering hints.


GBP/USD is under pressure below 1.3700, trying to find its feet after Friday’s severe blow. The bears retain control amid a broadly stronger US dollar and looming Brexit risks.


USD/JPY remains on the front foot above 114.00, recently easing from an intraday top of 114.25, amid the initial Tokyo trading hour on Monday. In doing so, the yen pair rises for the second consecutive day with 0.30% intraday gains at the latest.


AUD/USD bears take a breather following Friday’s Rising Wedge confirmation, down 0.10% intraday around 0.7510 heading into Monday’s European session.


NZD/USD defends late Friday’s recovery moves around 0.7175 during early Monday. The kiwi pair bounced off a horizontal area comprising multiple lows since October 22 the previous day. The upside momentum also take clues from China’s Caixin Manufacturing PMI for October, 50.6 versus 50.00 expected and prior.


USD/CAD struggles to extend Friday’s recovery moves, edges higher around 1.2380 amid Monday’s Asian session. Alike all majors, the Loonie pair also had to respect the broad US dollar gains the previous day but a lack of major greenback positives afterward challenge the quote’s latest moves. Even so, the pair bears refrain from entry amid downbeat prices of oil, Canada’s biggest export item.


The USD/CHF pair is in a downtrend, shown by the simple moving averages (SMA’s) located above the spot price. Furthermore, a descending channel that seems to be a bullish flag capped the last downward move, bouncing off the bottom of the channel, towards the 50-simple moving average at 0.9181.


WTI is stalling on the bullish cycle that has been in place since the end of summer 2021. Super high

prices could well be struck by the law of gravity in the coming days and weeks ahead and the following analysis illustrates the bearish bias building on a daily basis.


Gold edged higher during the early part of the trading action on Monday and moved away from over one-week lows touched in the previous session, albeit lacked any follow-through. Data released on Friday showed that the Fed’s preferred inflation gauge – the Core PCE Price Index – held steady near 30-year highs, suggesting that consumer cost pressures are getting entrenched. This validated expectations that the Fed would be forced to adopt a more aggressive policy response to contain stubbornly high inflation and weighed heavily on the non-yielding yellow metal. Apart from this, a strong pickup in the US dollar demand exerted additional pressure on the dollar-denominated commodity and contributed to Friday’s sharp intraday decline.

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